Purchase of West Broadway properties for future housing wins initial city approval

Editor's note: This story has been corrected from an early version, which suggested tax increment financing would be used to purchase the Broadway properties. Proceeds from the sale of surplus water utility properties will fund the purchase.

Members of the Missoula City Council on Wednesday gave preliminary approval to the purchase of two West Broadway properties for a total of up to $775,000.

The properties include 1337 and 1359 W. Broadway, which are currently occupied by local businesses including Recompute Computers and Wooden Images. Both are also located next to Missoula Water, which the city plans to consolidate in the future, possibly with a move to Scott Street.

That would leave the three contiguous lots open for redevelopment into mixed-use housing at some point in the future.

“We don’t have enough rooms for public works in Missoula, particularly with Missoula Water,” Mayor John Engen said. “Recompute [Computers] will allow us to accommodate those needs and Wooden Images would allow us to manage parking and assist customers better.”

According to Ross Mollenhaur, the city’s interim deputy public works director, Missoula Water needs additional office space, as they are currently “crammed” into their existing building.

“We’ve got three stormwater people sharing a single office, which never works great when people are taking phone calls and the noises are echoing,” Mollenhaur said. “There's just a lot of space needs in that building that this would really help to address.”

Engen said this acquisition would be consistent with their existing actions on West Broadway, following the $1.1 million purchase of Sleepy Inn last April. He said it also falls in line with the city’s purchase of former industrial property on Scott Street last August.

The largest affordable housing project built on trust fund land was unveiled Wednesday on a portion of the city's Scott Street property.

“This is an opportunity for us to make acquisitions, leverage, reinvest and then recoup some of those expenditures further,” Engen said. “So this is the beginning of something very similar to that (Scott Street) project. And in the interim, it provides opportunities to take care of our customers by having adequate facilities.”

The purchase of the West Broadway buildings will be made using proceeds from the sale of surplus water utility properties. The city treasury will lend the water utility funds for this purchase until the water utility’s properties are sold. 

The Public Works Committee approved the acquisition on a 9-2 vote with council members Jesse Ramos and Sandra Vasecka voting against it.

Ramos said he felt the price on the properties were appropriate, but took issue with how they were paying for it. Ramos has criticized the use of tax increment financing in the past, though advocates believe it's one of the strongest and only tools available to Montana cities to guide redevelopment.

“I'm concerned about the bridge financing on the MRA (Missoula Redevelopment Agency) and certainly there's some bills in the legislature working on kind of addressing that right now. But I just don’t think it is personally proper for TIF funds to be utilized that way,” he said.